© Reuters.
Datadog (NASDAQ 🙂 reported better-than-expected results and guidance in Q1.
The company adjusted EPS of 24c in the first quarter, compared to 6c last year and higher than consensus estimates of 11c per share. Revenue entered $ 363 million, up 83% YoY and leading the analyst consensus of $ 337.3 million. The adjusted gross margin stood at 80% during the period, compared to 77% in the same period last year.
Going forward, DDOG expects adjusted EPS in the range of 13c to 15c in the second quarter, while analysts are looking for 12c per share. Revenue is expected to reach between $ 376 million and $ 380 million for the quarter, which is more than the estimated $ 361 million.
Datadog expects FY adjusted EPS in the range of 70c to 77c, from its previous forecast of 45c to 51c, and higher than the consensus projection of 50c. The company expects FY revenue in the range of $ 1.6 billion to $ 1.62 billion, from the $ 1.51 billion to $ 1.53 billion coverage it previously guided, and more than the expected $ 1.53 billion.
JP Morgan’s TMT Research team of analysts blamed the initial 10% decline on “slight decelerations”. The shares in the meantime erased losses to trade virtually unchanged.
Revenue rose 83% in the quarter, down from the 84% growth seen in the last quarter.
“It looks good overall so it’s a bit of a headache to react negatively except for one of the most favorite growth software sought AND maintains high multiple ~ 30x FY22 Sales estimates,” analysts wrote.
Goldman Sachs analyst Kash Rangan said the DDOG delivered “a solid beat.”
“We see Datadog poised to grow into a well -known infrastructure software business. We point the comparison against ServiceNow (NYSE 🙂 at +$ 5bn in revenues and +30% FCF margin, valued at +$ 110bn. We believe that Datadog is a strategic infrastructure software provider with its end-to-end observability platform ready to benefit from IT departments shifting utilization from a multi-point solution towards an integrated suite … With a ~ $ 1bn revenue run rate compared to a $ 50bn + addressable market ($ 20bn APM/infrastructure + security components + digital engagement components), we see a big runway ahead, ”Rangan said on a note.
By Senad Karaahmetovic